Issue #4, November 2016

Special edition : IT & ITES sector development

NTF III PROGRAMME

The NTF III Programme, which is funded by the Netherlands’ Centre for the Promotion of Imports

from developing countries (CBI), aims to build export competitiveness in key sectors in selected

developing countries. The programme focuses on creating and supporting jobs in information

technology (IT) and IT-enabled services (ITES) in Bangladesh, Kenya and Uganda; avocado in

Kenya; coffee in Uganda; and inclusive tourism in Myanmar. The goal is to enhance export

competitiveness of these sectors, leading to increased revenues for enterprises.

What is inside the fourth edition of the newsletter?

This current issue focuses on the IT & ITES companies’ development, highlighting findings from a

sector competitiveness study undertaken in Kenya and Uganda, as well as from a survey of

women-led IT & ITES businesses. Furthermore, one of our export marketing coaches from

Bangladesh shares his experiences in working with and coaching enterprises in Kenya and

Uganda.

IT & ITES

There has been considerable improvement among the small and medium-sized enterprises (SMEs)

in Bangladesh’s IT & ITES sector with which ITC and CBI have been working. However, the NTF III

companies in Uganda and Kenya still have some weaknesses that must be overcome for them to

become more competitive on both the regional and international levels. ITC has conducted a

competitiveness study among NTF III IT & ITES beneficiaries that provides good insights into the

strengths and weaknesses of the IT & ITES sector in East Africa. The NTF competitiveness study

was conducted in late 2015 in Kenya and in early 2016 in Uganda.

The findings show that the lack of a competent and educated workforce is a major obstacle. Firms

report that they face difficulties in managing their business and growth because a skilled and

proficient workforce is unavailable. In addition, more companies need to acquire internationally

recognized quality certificates to expand their exports and competitiveness. Another fundamental

area that must be developed further is the companies’ capability to connect. Firstly, attendance at

regional – and particularly international – trade fairs has to be increased. Secondly, more

advertising and targeted marketing are needed for companies to gain greater visibility.

Netherlands Trust Fund III Newsletter

The companies were also asked about the services of trade and investment support institutions

(TISIs) in their countries. The answers show that there is still a need for capacity building of TISIs

to serve the industry. SMEs require targeted services by the TISIs. Moving forward, Kenya IT and

Outsourcing Service (KITOS), for example, set

up and managed a successful business to

business (B2B) event in Kenya. In August, six

companies from Bangladesh participated in a

B2B matchmaking with the Kenyan enterprises.

WOMEN IN IT

The NTF III programme increasingly focuses on

women in technology. Women do not typically play a prominent role in the IT & ITES sector.

However, there are successful women entrepreneurs in this industry, and NTF III supports some of

them through targeted training and workshops, as well as event and meeting participation.

There are differences among NTF III companies in the

number of full-time women employees. While women

comprise nearly half of the workforce in Kenyan Tier I

companies – those that are already exporting – Ugandan

Tier I companies have only 17% women in their full-time

workforce. However, as Ugandan export- ready Tier II and

non-exporting Tier III companies have more full-time

female workers than Kenyan Tier II and Tier III companies, the overall percentage of women

working full-time in IT & ITES is higher in Uganda. Nonetheless, it becomes apparent that fewer

women are employed than men.

A recent survey among women-led IT & ITES companies that are NTF III beneficiaries asked the IT

& ITES women entrepreneurs in Bangladesh, Kenya and Uganda about their businesses

development through the programme. Here are some key findings:

An impressive 95% were able to improve their skills thanks to the trainings and workshops. Skills

in Export Marketing Planning and Value Proposition and Branding were named as the top

gained skills, followed by Negotiations and Sales and Pitching. Business Strategy was also

among the top five skills. Some of the women gained, among others, communication,

presentation and project-management skills, and expanded their knowledge in product

development, customer management, and certifications and standards.

Export Marketing Planning

Value Proposition and Branding

Negotiations and Sales

Pitching

Business Strategy

0 20 40 60 80 100

Financial management

Leading, organizing and managing your business

Requirements and standards of (inter)national buyers

How to develop and implement an Export Marketing Plan

Pitching yourself and your company

International certifications and standards

Project management

Knowledge improvement of women entrepreneurs in the IT & ITES sector

Don’t know

Improved considerably

Improved slightly

Did not improve % of respondents

Through a diversity of targeted trainings and workshops, women who have participated in NTF III

were able to improve their knowledge in different areas.

75% of women-led companies attended on average three B2B events, national

and international

85% see improvement in export competitiveness through NTF III as well as

increased success of their business

95% say that NTF III’s women-focused activities empowered them as a woman in IT

100% say that project activities and events with a focus on women created

added value to the women and their businesses

For more information on Women in IT click here.

World Export Development Forum 2016 – Trade for Success: Connect, Compete, Change

The World Export Development Forum (WEDF) is the flagship event of ITC. This year’s event took

place on 12-13 October in Colombo, Sri Lanka. The forum was co-hosted by ITC and the Ministry

of Development Strategies and International Trade of Sri Lanka, through the Sri Lanka Export

Development Board (EDB). WEDF is a unique global conference and B2B matchmaking platform

dedicated to supporting trade-led development. It brings together more than 600 business

leaders, policymakers, heads of trade and investment support institutions and international trade

development officials to address global competitiveness for developing countries.

NTF III Bangladesh brought 6 IT & ITES companies to the event, amongst them the women

winner of the Seedstars World Dhaka 2016 start-up competition, Shopfront. NTF III Kenya invited

one of its IT software development companies to the event, Attain enterprises. All of them had

the chance to participate in the targeted B2B meetings organized by ITC. Furthermore, the NTF III

Associate Programme Adviser organized and held a plenary workshop on “Business Development

for IT entrepreneurs”, together with Sri Lankan entrepreneur Mangala Karunaratne and

Bangladeshi NTF III beneficiary and business woman Rezwana Khan. The workshop covered the

art of bootstrapping and client acquisition, public procurement, as well as marketing services vs.

products and was well received.

50% of new prospective clients are

women

50% of new business

contacts are women 55% found new business contacts

80% connected with prospective clients

ZimbaWomen

ZimbaWomen, an NTF III beneficiary company, seeks to create opportunities for women to

participate in the economy by providing access to skills and training for female entrepreneurs. On

28-29 September, ZimbaWomen held its first annual Technology for Business summit in Kampala.

Seedstars Group, which holds annual global seed-stage start-up contests for emerging markets,

provided a pitch training session during the conference. The Geneva-based group was also one of

the sponsors of the summit, joining the likes of Facebook, the United States mission in Uganda

and ITC. Conference speakers included Facebook’s public policy manager for Africa, the

presidential adviser for trade in Uganda and the co-founder of !nnovate Uganda. The theme of

the summit was how to break business barriers using technology – a topic that was chosen

because most SMEs in Uganda still use traditional media for marketing and reaching out for new

business. Conference participants learned how to use digital marketing, social media, Excel and

other tools to advance themselves.

“To say that the Zimba Technology for Business Summit 2016 was a success would be a gross

understatement – it was everything we had hoped for, and then some!” ZimbaWomen, 2016

For more impressions of the IT for Business Summit, follow the digital footprint #ZimbaSummit16

and #tech4biz on social media.

GEM-TECH Awards 2016 – Gender Equality and Mainstreaming

The International Telecommunication Union’s (ITU) annual GEM-TECH award, jointly organized by

ITU and UN Women, honours personal or organizational achievements and innovative strategies

to advance Gender Equality and Mainstreaming in the area of ICTs.

Amongst 311 nominations, Bangladesh Association of Software and Information Services (BASIS)

Women’s Forum was shortlisted as one of three finalists for the prestigious GEM-TECH Awards

2016 in the category “Develop Gender Responsive ICT Governance, Policy and Access”, following

a nomination by NTF III Bangladesh. BWF is an initiative of BASIS, main project partner of NTF III

Bangladesh, to empower women in the ICT sector.

Approximate statistics of the almost 1000 member companies show

that of all the companies listed only 13% women work in the sector

and only 3% hold an entrepreneurship or leadership position. To

enhance women's participation, BASIS Women’s Forum focuses on

raising social awareness, capacity building sessions, advocating for

policy changes, networking platforms, resource mobilization and

mapping and monitoring progress.

INTERVIEW WITH OUR COACH RASHED KAMAL

Rashed Kamal is an IT & ITES entrepreneur in Bangladesh. His company has been benefiting

from NTF support in the past. Moreover, he was trained as and is working as an export marketing

trainer and coach for IT & ITES companies in Bangladesh, Kenya and Uganda. He has valuable

insights into the industry and the companies with the obstacles they are facing. We asked him to

share his knowledge about IT & ITES companies.

ITC: Where do you see differences in the business and

managerial mindset and progress of Bangladeshi, Kenyan and

Ugandan companies regarding international business (including

regional deals)? Are there differences in companies’ business

attitudes?

RK: Bangladeshi software and ITES companies are a lot more focused

on international business, as these companies have been going

through training and coaching (ITC interventions, CBI’s Export

coaching programme, including export marketing plans) since 2008.

As a result, the average level of competency is therefore higher than

the average level of African companies. Moreover, from my

experience, I have seen that there is a difference between the

mindsets of the personnel, too. Up to now, the IT & ITES industry in

Kenya and Uganda is not very mature. Once the companies become more focused, there is

definitely a huge potential for future market growth.

ITC: What is missing on company level to increase competitiveness? Where do you see

progress?

RK: First of all, willingness, along with the potential market knowledge (about the EU and regional

market), is missing, and the companies will have to improve their infrastructure accordingly. One

plus point that the African companies have is the knowledge of English, which may give them a

competitive advantage over Bangladeshi (or any other Asian countries’) companies. Unfortunately,

I have seen a lack of awareness among the

CEOs regarding international business

opportunities. They depend on local

consultants for their marketing and

operational activities, which I believe are not

always positive. My honest opinion is that

these companies should burn their finger

first rather than depend on consultants.

The CEOs should be trained first as they

have the main execution power to jump into

international markets.

ITC: How would you rate the companies’ technical and managerial skills? What has

improved and where is improvement still needed?

RK: Although I was not directly involved with their technical skill assessment, I have seen their

products and offered services. These products are good for their regional market standard. But if

they want to enter the EU and US markets, there is a lot of refurbishing needed. I saw a problem

of focus and specialization in their product strategies, and many of the companies are running

as a generalist company rather than specialists. However, some companies are impressive and will

do excellent internationally if they get properly trained.

ITC: How sophisticated are the companies’

marketing strategies? What came out of

the recent trainings on export marketing

plans?

RK: Before the start of the training, I found

that a lot of companies were not familiar with

international marketing techniques. Although

some of them were engaged in IT export

before, they exported through middle men or

third parties. We trained them intensively on

market entry strategies, marketing channel, positioning, branding, value proposition, USPs and

action plans, along with budgeting, and tried to make them focused. It is definitely mentionable

that those who followed our guidelines improved a lot. However, more improvement is

expected in the next two months.

ITC: How is the business environment for IT & ITES companies in the single countries? What

is an obstacle and where do you see progress?

RK: Business environment is good in single

countries. Nowadays, governments are

trying to focus on this sector. However, their

industry associations and government

liaison need to be improved a bit. There are

different possibilities to promote the sector,

for instance through tax incentives,

incubator development, etc. From

experience in Bangladesh, we have seen a

lot of new-generation companies entering

the IT & ITES sector, and eventually the

industry will become more mature.

ITC: What constraints hamper the companies’ competitiveness?

RK: Internet speed has a lot of room to be improved further. Although they are planning to set up

an intranet among the regional countries, they need proper Internet connectivity with a backup

connection in order to sustain in these days of tough international competition.

ITC: What are Kenya’s and Uganda’s strengths in the IT & ITES industries in light of the

companies you have trained?

RK: English communication and time zone may be a good advantage for them to get into the

European market. However, for market entry, I would definitely mention that a lot more

willingness and focused effort is required on company and government level.

RECENT NEWS

Kenya Avocado: Some 500 farmers will

benefit from higher prices per fruit as a

result of direct one-to-one linkages

established with exporters. Ten contract

agreements were signed between exporters

and farmer groups at the end of September

2016. This new approach between exporters

and direct suppliers will facilitate the

training in international standard

certification such as GlobalGAP, leading to

higher quality and prices. Subsequently, it will have a positive impact on smallholders’ livelihood.

Meanwhile, the GlobalGAP training is ongoing, and farmers’ groups are expected to be certified

for the next avocado season starting in February 2017. The beneficiary companies linked to these

farmer groups will offer GlobalGAP-certified avocados at Fruit Logistica in February 2017, opening

new market and business opportunities.

Myanmar Inclusive Tourism: During a two-day

training programme in Yangon, more than 15

representatives of Yangon-based tour operators

were coached on how to integrate sustainability

and corporate social responsibility (CSR) principles

in their normal businesses practices. The tourism

professionals learned how to make sustainability

part of their office operations by, for instance,

saving energy and reducing paper as well as by

implementing staff-related social policies and

human rights. Participants also familiarized

themselves with the principles of sustainability

management and created their initial sustainability mission statement, policy and action plan. In

addition, they were updated about the growing expectations of international consumers and

business partners for accountability on sustainability and how to apply the international Travelife

Sustainability System, a training, management and certification initiative for tourism companies

committed to sustainability.

On 4 October, Myanmar Vice President U Henry

Van Thio visited Kayah state. His visit included Hta

Nee La Leh, one of the villages where ITC has

developed Cultural Tourism tours under the “NTF

III Myanmar Inclusive Tourism focusing on Kayah

state” project. The vice president selected the ITC

project as one of the only two destinations of his

mission to Kayah. ITC’s local team and the villagers

themselves presented the project’s activities and

explained how the key issue of post-project

sustainability is being addressed.

Uganda Coffee: The capacity of three trade and

investment support institutions (TISIs) was

enhanced in price and insurance risk

management as well as market intelligence,

resulting in increased export potential and

improved services to export-oriented farmers’

associations in the coffee sector in Uganda. In

addition to providing trade related services, the

TISIs also sell on behalf of their members.

Business linkages were created and expanded

through the participation of TISIs in major

international trade fairs and exposure to buyers interested in speciality coffees. As a result,

supported TISIs reported potential sales of both Robusta and Arabica for an estimated amount of

US$ 5 million.

Furthermore, first preparations for the implementation of FairTrade certification were made at

institutional and at farmers’ level. Thereby, the capacity for FairTrade certification of NUCAFE, one

of the supported TISIs, as well as of three selected coffee farmers’ associations was built. The

advantage of FairTrade compared to other international sustainability certification standards is

that, in addition to opening new markets opportunities, it offers the possibility for coffee farmers

to get the certification costs supported for up to 75% of the total certification fee.

UPCOMING EVENTS

November 2016, 7-9 Myanmar Tourism: World Travel Market (WTM) in London, UK

November 2016, 14 Bangladesh IT & ITES: B2B event in London, UK

November 2016, 22-24 Bangladesh IT & ITES: B2B event in Rotterdam, The Netherlands

November 2016 Kenya and Uganda IT & ITES: Companies’ Export marketing plans validation

November 2016, 30 IT&ITES: Slush start-up event in Helsinki, Finland

January 2017 Bangladesh IT & ITES: Softexpo IT fair in Dhaka, Bangladesh

February 2017 Kenya Avocado: Fruit Logistica Trade Fair in Berlin, Germany

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